U.S. Blacklists N.Korean Bank

      August 13, 2009 10:08

      The U.S. Treasury Department on Tuesday added Korea Kwangson Banking Corp. to a list of North Korean institutions subject to sanctions. The move came just a week after former U.S. President Bill Clinton visited Pyongyang and met North Korean leader Kim Jong-il.

      The decision confirms that the Barack Obama administration has not changed its policies toward North Korea after Clinton's visit, which it says was purely a humanitarian mission to free two detained U.S. journalists.

      KKBC was targeted for providing services to two North Korean institutions -- Tanchon Commercial Bank and Korea Hyoksin Trading Corporation -- accused by the United States of being involved in the proliferation of weapons of mass destruction. Stuart Levey, the under secretary for terrorism and financial intelligence at the Treasury Department, said KKBC, which operates several branches overseas including in Dandong on the Chinese border, "demonstrates the lengths to which the regime will go to continue its proliferation activities and the high risk that any business with North Korea may well be illicit."

      The Treasury decision prohibits Americans as well as foreigners in the U.S. from dealing with KKBC. There is a strong possibility that foreign banks operating in the U.S. will construe the Treasury sanctions as compelling them to stop dealings with the North Korean bank.

      Michael Schiffer, a deputy assistant secretary of defense, said joint military exercises between South Korean and U.S. troops starting on Monday "will not be downsized and will be held as planned." In an interview with the Chosun Ilbo, Schiffer said, "As far as I know, there will be no changes to [the exercise] at this point and it will proceed as scheduled."

      The U.S. position is that as long as North Korea fails to return to the six-party nuclear talks and fulfill its pledge to dismantle its nuclear weapons program, it will not be able to engage in any bilateral dialogue with Washington. Some officials in Washington believe North Korean leader Kim Jong-il may have worsened matters during his meeting with Clinton by emphasizing demands for Washington to stop its "hostile" policy toward Pyongyang and for bilateral talks while the North's nuclear program remains intact.

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